What must be true for the Coase Theorem to hold? For the Coase Theorem to hold,Answer: all parties to an agreement must be willing to accept a reasonable agreement.Right! The Coase Theorem: the argument of economist Ronald Coase that if transaction costs are ow, private bargaining will result in an efficient solution to the problem of externalities. In practice, we must add a couple of other qualifications to the Coase Theorem. In addition to low transaction costs, parties to the agreement must have full information about the costs and benefits associated with the externality, and all parties must be willing to accept a reasonable solution.